Elon Musk says there's 'no such thing' as a business

Billionaire entrepreneur Elon Musk seems to have his hands in
every industry these days. You could argue he's one of the
savviest businessmen around.

But when Musk sat down with Wait But Why's Tim Urban, he said
something really surprising:

"I don't know what a business is," Musk
told Urban. "All a company is is a bunch of people together
to create a product or service. There's no such thing as a
business, just pursuit of a goal — a group of people pursuing a
goal."

This statement actually makes a lot of sense when you learn more
about the inner workings of his companies. He runs a lot of
businesses, but not in a conventional way.

For example, he started his rocket company SpaceX by first
learning all he could about rockets, and then rounding up the
most brilliant rocket engineers he could find.

He also didn't (and still doesn't) hire employees based on their
degrees. Musk is more interested in qualities like raw talent,
ability to work well with a team, and deep passion for the SpaceX
mission.

If everyone at SpaceX fits that description, then it sounds
exactly like a group of smart people working toward a shared goal
— not necessarily how we typically define a business.

Another key element is that SpaceX builds almost every part of
each rocket it produces. That's highly unusual for the aerospace
industry, according to Urban. Most companies will specialize in
building a few rocket pieces and then buy the rest from other
companies.

Since SpaceX builds almost every part it needs, it can remain
that same autonomous group of people working toward a collective
goal that Musk described. You can also argue it promotes more
teamwork: SpaceX engineers sit right next to the SpaceX designers
and manufacturers. Different teams sharing the same space is not
typical of other companies.

Another characteristic that separates Musk's businesses from
others is how much control he has over them.

"Some bosses are called micromanagers — at Musk's companies, his
level of involvement earned him the term 'nanomanager,'" Urban
writes.

That's because Musk has made himself an expert in a lot of areas.
For example, when
something goes wrong during a SpaceX rocket launch, it's
often Musk himself that will brief the public on exactly what
went wrong, down to the nitty-gritty engineering details.

So maybe Musk doesn't know what a business is, but he's figured
out a very effective way of running them.